Barclays penalised for lapses

Australia’s securities regulator takes action against British lender over lack of disclosure

Three units of Londonbased Barclays have been penalised by Australia’s securities regulator for failing to tell clients they didn’t hold local financial services licenses and instead were regulated overseas.

Under the Australian regime, foreign firms which offer services to the wholesale market can obtain exemptions from full domestic licensing requirements, provided they make prominent disclosures that they are regulated overseas.

The Australian Securities & Investments Commission said in a statement yesterday that the units — Barclays Capital Inc, Barclays Capital Asia Ltd, and Barclays Capital Securities Ltd — failed to disclose the information to clients or inform ASIC of the breaches in a timely manner.

“The duration and number of breaches together with the failure to report breaches in time The UK Financial Conduct Authority (FCA) has reopened its investigation into Barclays’ 2008 emergency fundraising from Qatar despite issuing a fine in the case four years ago, as charging decisions from a parallel criminal case are set to be announced imminently, according to a person familiar with the probe.

The FCA called in a number of people for interviews in the case in recent weeks, said the person who asked not to identified because the process is private. The UK regulator already fined Barclays £50 million ($62 million) over the fundraising in 2013. The bank said it will contest the penalty but the challenge was put on hold pending the outcome of criminal probe by the UK Serious Fraud Office.

The investigations target two “advisory services agreements” worth £322 million (Dh1.48 billion) that Barclays committed to pay the Qatar Investment Authority during the 2008 financial crisis. demonstrated serious, systemic weaknesses in the compliance controls implemented by the Barclays entities to meet their Australian regulatory obligations,” ASIC said in a statement.

Disclosures

Barclays Capital and Barclays Capital Asia were not able to show they made the necessary disclosures since they began using the exemption in 2004 and 2006, respectively. Barclays Capital Securities could not show evidence of disclosure from 2004 to 2014.

Barclays largely exited the Australian market in 2016 as part of a wider cutback across the Asia-Pacific region.

The three units have agreed to an enforceable undertaking with the regulator — an Australian legal device often used instead of civil court action — and have agreed to engage an independent expert to review their compliance frameworks. Collectively they will also make a A$500,000 (Dh1.4 billion, $383,000) contribution to the local Ethics Centre.